Fast Company's Adele Peters takes a closer look at Munich's plan to build a four-story, 120-unit apartment building on top of a city-owned parking lot this year, as the pilot project for an initiative that aims to provide affordable housing for low income families, students, and refugees.

The rapidly growing city expects its population to grow by 15% to more than 1.7 million people by 2030, and it is quickly running out of space for new construction.

"The accommodation of refugees is a big challenge for Munich," says Alexander Reissl, the floor leader of Munich's ruling Social Democrats. "But not only for them do we need cheaper apartments. Munich is the city with the highest rents in [all of] Germany. Students, trainees, or pensioners are seriously affected by the expensive prices in our city. To end the price spiral, we have to build many new lofts with reduced standards and subsequently hopefully with reduced rents."

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